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tv   Special Report With Bret Baier  FOX News  February 9, 2011 4:00am-5:00am EST

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that's the point. >> tell colin quinn i am still in a feud with him. >> thank you. >> back to you, greg. >> thanks, andy and monica. always a delight. dana, highl entertaining in -- highly ebt taning. see you next time. >> bret: a tax hike, bail-out or rescue. democrats and republicans weigh in on a key proposal in the president's upcoming budget. we'll tell you why buying a house could get more expensive soon. and another blow to moderate democrats. live from our studio in washington, this is "special report." good evening, i'm bret baier. we are learning more about president obama's upcoming budget request that is now just days away. it includes the usual and the unusual. specifically, a way to allow states to replenish their strained unemployment
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insurance funds. but who is going to pay the bill? white house correspondent mike emanuel looks for some answers. >> reporter: vice president biden rode amtrak train to sell the administration's plan to spend $60 million in six careers on high-speed rail. $8 million will be part of the budget plan released on monday. still, biden says the 2012 budget will reflect the administration's spending on cutting spending. >> it is going to hurt, hurt a lot of things we care about. but we have to get it under control. >> the new budget is also going to propose helping the 30 states from california to wisconsin to new york. which borrowed more than $42 billion from washington to cover their tapped unemployment funds. the taxes would take effect in 2014, and sources say they could generate up to $100 billion over a decade by collecting more payroll taxes from companies. white house spokesman says it will buy time for the states but is not another washington
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bail-out. >> in the future, states have to rationalize what they offer and how they pay for it. >> boehner called the idea job destroying tax hike on u.s. employers. as a fight over the budget is about to begin and a new senator says they need to readjust the thinking with the fiscal reality. >> government can be the provider. it what to be a partner. if anyone is looking to government to take care of them that's the wrong end of the horse, if you will. >> reporter: but deficit commission says compared to the ballooning entitlement, social security, medicare and medicaid, discretionary spending is a drop in the budget. >> it will be eaten up and crushed and pushed aside by the engine that has no brakes. >> reporter: current republican leaders say a five-year freeze of discretion anywhere nondefense spending which the administration proposed isn't going far enough. >> if we don't immediately reduce the size and scope of the federal government, the deficit will be even bigr than last year's record deficit.
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so we have to get real. we need to listen to our constituents, freezes aren't going to cut it. >> while, there is a great deal of talk in washington these days about spending and taxes, one person who isn't saying tobacco taxes is president obama who struggled with smoking for years the first lady told a group of print reporters today the president has not smoked in almost a year and said she is very proud of him. bret? >> bret: okay, mike. thank you employers posted over 3 million job openings in december, a drop of 140,000 from november. with 14.5 million people out of work, almost five people are competing for every available job. stocks were up today. dow gained 17-1/2. s&p added 5-1/2. nasdaq finished up 13. federal reserve official said strengthening economy mean's the central bank $600,000 billion bond purchase program may not be necessary. the president of the federal reserve bank of richmond predicts the economy will grow
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at 4% this year compared to under 3% in 2010. it's federal government gets its way, some mortgages may soon be more expensive. fox business network peter barnes is here to explain why. >> good evening. the cost of some mortgages could go up as part of the obama administration plan to overhaul mortgage giants fannie mae and freddie mac. for fees, the companies ensure mortgages against default to encourage lenders to make lots of loans at low rate and make housing more affordable. fannie and freddie collapsed when the housing bubble popped in the financial crisis. so far, the treasury pumped $150 billion in to them. later this week, the treasury is expected to release its proposal for fixing the company and mortgage markets so the taxpayers don't have to bail them out again. housing industry sources say the plan could include higher charges by fannie, freddie, and other government mortgage insurance programs. am lists say the increases could boost monthly payment,
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by as much as one percentage point, and $100,000 30-year mortgage with rate of 5% now it could raise payments by more than $60 a month. treasury spokes penn declined to comment on details of the plan, but it would be phased in over many years assumed it was adopted by congress to mine mize impact on the housing market. separately today, bret, the federal reserve took another step to make sure that taxpayers don't have to bail out financial firms in the future. it issued proposed rules, too, for the first time. regulate big nonbank firms liking aand other insurance companies. >> bret: peter, thank you centrist democrats are feeling more isolated tonight, because of the impending demise of a group near and dear to their hearts. chief washington correspondent jim angle has a political obituary. >> reporter: the democratic leadership council, laboratory for moderate democratic policy ideas and once chaired by arkansas governor bill clinton
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is folding. >> the d.l.c. was the pre-eminent mod earn think tank of the last three decades. came along in the mid-'80s and really sought to yank the democratic party toward the center. >> reporter: the d.l.c. generated in of the ideas clinton took with him to the white house. then the organization third way taken its play in one sense, but the d.l. cbs was more than think tanks. >> moderate party inside democratic party it worked in the south and the border states. worked to recruit conservative democrats. >> now the moderate house democrats say they get no respect, that former house speaker nancy pelosi snubs them, even as the ranks dwindlalling. 54 were going in the e, he, 25 survived. swing voters didn't like the position of the democratic
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party there we're going to the left and people who gave the democrats a chance in tuition and 2008 decided to go a different direction. >> some democrats, pelosi chief among them, think democrats were punished in november because they weren't liberal enough. they threatped to block his tax cuts. >> they thought they were voting for someone who turned out they were different than expected. we've been baffleed by this. >> baffleed because he says other democrats have always seen obama as moderate and point to naming bill daley as chief of staff and other recent moves. others see conversion born of necessity. >> they have awakened to the reality if obama wins a second term it's because the independents and moderates support him, not just liberals. >> reporter: in fact, liberals only represent 20% of the electorate. many voters see mr. obama as one of them, but liberals made clear they feel betrayed.
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saptos says if he is not liberal enough for the democratic left, democrats will have a difficult time winning national elections. >> bret: more on this with the panel. thanks. minnesota republican congresswoman michele bachmann has until thursday to respond to inquiries from federal election officials about her campaign fundraising last year. they want itemized details for $6 million donations. bachmann's office says the high amount of individuals giving small donations is likely a factor. the transportation department says there was no electronic cause of the high-speed accelerations that sparked massive recalls of toyota vehicles. says the only known causes were mechanical. they recalled vehicles from 2009 to address various safety issues. president obama says he has not raised tax since taking office we'll fact check that later in
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the grapevine. but first, we go live to cairo for the latest on the egyptian demonstrations.
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>> bret: ra pro-life group targeted planned parenthood released another video.
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showing it gives employees about health services for underage sex workers. planned parenthood of new york says the video does not accurately portray the practices. we told you about several ways people are trying to get rid of or change president obama's healthcare law. tonight, lawmakers in the gem state are doing about it. here is correspondent -- >> opponent of the healthcare law, including the group of republican idaho state lawmakers are digging up a controversial centuries old maneuver to try to quash it. nullification. under the theory, states argue they can simply invalidate a federal law if they believe it's unconstitutional. >> ide he, we don't want you complying with this. >> reporter: in at least 12 states across the country, legislators introduced measures to nullify all or part of the healthcare law. including in peninsula, where a house committee passed a provision monday that would
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allow the states to refuse to recognize only the portions of the law connected to the individual mandate. but there are plenty of nullification skeptics, including hide he's own attorney general office. two weeks ago, they issued a legal opinion discounting the theory. "there is no right to pick and choose which federal law the state will follow." idaho lawmakers scrambled to strip the word "null and void" from the bill but say the underlying premise is the same. directing state agencies not to spend any time, resources or energy to comply with the federal healthcare law. some constitutional law scholars believe the entire premise is fatally flawed. >> the analysis by the attorney general was spot on. the reality is that this bill would eviscerate the supremacy clause, it would flip the constitution on its head and return to us the days of the articles of confederation, which the framers rejected. >> reporter: the supreme court has also frowned on the
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concept of nullification. most recently in 1958, in the context of a number of states that passed laws banning compliance with the desegregation order and brown versus board of education. still, the man who drafted idaho's legislation, republican state senator monte pierce is optimistic. >> well, if we didn't believe it would pass, we wouldn't be bringing it. there is a very good chance. we have a great support in the public. our people are behind us. >> reporter: democratic lawmakers in idaho call the effort a waste of time and money. but republicans control both houses. and republican governor bush otter expressed his support for the idea. bret? >> bret: shannon, thank you. ♪ ♪ tonight we begin a special look at education with a focus on one type of school that consistently out performs many others. correspondent peter doocy tells us the proof is in the
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numbers. >> america's catholic schools say their 2 million plus students will score on average 23 to 43 points higher than public school kids on their s.a.t.s. even though parochial schools spend thousands less per pupil. experts say this is partly because catholic school kids don't just answer to a principle. there is a higher authority. >> because they're catholic, they hold you to a certain moral demeanor, a moral standard. so they expect you to behave as better. they expect you to act better. they expect you to reach your highest potential. >> reporter: you don't have to be catholic to go to catholic school. anyone can enroll. but unlike tuition-free public school, it can cost a lot. so the 7 ,094 catholic schools in the u.s. have to perform well because they know if kids don't get good grades, their business will be bad. >> catholic school to be believers. and they have to pretty high standards because they make people on part with their
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money to athis end them. >> reporter: catholic schools are able to choose their textbooks and teachers because they don't get tangled up big bureaucracies or unions. >> the teacher and the principal have a real opportunity in a catholic school to be the leaders. and they make curriculum choices. close to the students. >> reporter: but some educators say catholic schools aren't better, they just have better students because they can be picky about whom they let in. >> catholic schools do not have to accept every student like a public school does. catholic schools can expel students easier than a public school can. and catholic schools jeply don't provide services for children who are disabled. >> reporter: the last decade, the number of catholic schools and students have declined by 20%. but, advocates say they want national school vouchers because parents no matter how much they make, pay taxes for public schools in this economy, nobody wants
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to pay for their child's education twice. in washington, peter doocy, fox news. >> bret: we will fact-check one of president obama's remarks from the bowles interview with bill o'reilly coming up. and what profession has a very high percentage of liberals?
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>> bret: now fresh pickings
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from the political grapevine. the website politiffact told president obama he was wrong in the o'reilly interview that i didn't raise taxes once. they point out that that is false. they cite a tobacco tax hike and host of new taxes included the healthcare law. president obama also said, "i lowered taxes over the last two years." americans for tax reform claims the president, "signed in to law $7 in permanent tax hikes for every one dollar in permanent tax cuts." however, politifact gave president obama mostly true rating, reasoning the majority of the taxpayers ended up with a tax cut. white house press secretary robert gibbs incyst statistics show americans are paying less in taxes than during the previous administration if you think the mainstream media is full of liberals, check out the field of social psychology. the "new york times" reports the university of virginia jonathan hype took a survey at
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a recent con frence and found out that one, out of 1,000 of his peers, self-identified liberals made up 80%. centrist and libertarians fewer than three dozen. just three, three out of the thousand identified themselves as conservatives. hype concluded anywhere in the world that social psychologists see women or minorities underrepresented by a factor of two or three, our minds jump to discrimination as the explanation. when we find out that conservatives are underrepresented among us, by a factor of more than 100, suddenly everyone finds it quite easy to generate alternate explanations. finally, the nato alliance plans to spend $1.3 billion on the new headquarters in brussels. cit igs say that amount of money is unnecessary, nep a time of international belt-tightening. but nato officials claim the temporary quarters they have used since 1966, are in such disrepair they would be condemned under civilian
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guidelines. ♪ ♪ >> bret: two of three teenagers fatally shot saturday in a car dealership in juarez, mexico, apparently went to high school in el paso, texas. authorities say they have no leads in the death of 15-year-old juan carlos and 16-year-old carlos gonzalez. along with another 17-year-old boy. friend of two of the boys said they attended a party at juarez friday night and stayed in mexico to look at cars. the situation in other smaller mexican towns is almost unimaginable. correspondent steve harrigan has the story from guadalupe. >> reporter: help 7 wanted. police chief, guadalupe, mexico. the previous chief's head found in an ice chest. 20-year-old ericca gondarra took the job two days before christmas at 6:00 a.m., ten
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gunman pulled up to her house, dragged her out and burped down her house. she hasn't been seen since. we are in the center of a mexican town with no law enforcement. all eight police officers have been killed by the drug cartels or have quit and fled. now the chief is missing. the mayor, too. has left town. >> the 9,000 people who live here, one mile from texas, are back in the stone age. [speaking foreign language] "no police, she says. no water no, electricity. you wake up and hear gunshots. houses on fire we're scared." other border towns are no better. another police chief murdered this week. female police chief was killed in the town where another entire force of police quit after two of their colleagues were found beheaded violence by drug cartels in the big cities like juarez gets media attention. no one knows or even records how many are killed in small towns like this.
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where the state, the police, and the people have already given up, where nation's flag flies in sur render. in guadalupe, mexico, steve harrigan, fox news. >> bret: former defense secretary donald rumsfeld says in his new book he urged a military strike on a suspected chemical weapon site in northern iraq before the war. rumsfeld said it would have been time to coincide with then secretary of state colin powell's appearance at the united nations, laying out the case for war. it did not happen. but the facility was struck in the opening days of the conflict. rumsfeld wrote that the site was operated by terrorist group ansar al islam, and if it wasn't hit before the war, it would be abandoned no chemical weapons were found there. rumsfeld will be the only guest tonight on sean hannity's program at 9:00 eastern. one thing they will discuss, information that secretary powell was given.
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>> he felt he told me since that some people in the intelligence community under that one piece of -- understood that one piece of information he was given was a single source of information. he felt he didn't know that when he gave it. here is an honorable man. he worked hard on that speech. then for people to say bush lied and rice lied or cheney ryeed or rumsfeld lied, it's just not true. he believed every word he gave in that speech. >> bret: we will talk about president obama's plan to help states with their budget problems the fox all-stars join me after the break.
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we are giving help to some states who have had to borrow and not been able yet to pay back which would legally result in increase in the federal share that, that has
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gotten through tax, tax on businesses. which we don't think makes any sense right now. >> government can't be your provider. it has to be your partner. anybody that looks at government taking care of them, they are looking at the wrong end of that horse if you will. >> bret: the president's new budget will be unveiled if you will next week. and in that, we there will be a proposal to help states that can't, that have really tapped out on their unemployment insurance fund. there are 30 states across the country, as you look at them here. borrowed more than $42 billion from washington to cover their tapped unemployment insurance funds. basically, the white house is not calling this another bail-out they're saying it gives time for states to get around this difficult time. house speaker john boehner is calling the idea, "job destroying tax hikes" on u.s. employers, talking about the payroll taxes that would go in to effect in 2014. if this is confusing to you, hopefully the panel will help
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you out. steve hayes, senior writer for "weekly standard." mara liasson of national public radio. syndicated columnist krauthammer. steve just back from the bowles. congratulations to your packers. >> thank you very much. >> bret: this green is not for the green bay packers, but congratulations. congratulations nonetheless. >> i didn't pretend that it was. yes. >> bret: what about this? the pros and the cons, and what is being said about it? >> well, basically, this is a trade. i mean this is a time shifting maneuver in which you hike employer contributions to unemployment insurance to 2014. you move the level from 7,000, which it is currently to 15,000. so in that sense, john boehner is right. it would be ultimately a job-killing tax hike potentially. the difference is, or the tradeoff is in the interim, you don't pay that. and you don't pay the interest that states are otherwise paying now for 2011 and 2012. but it's a time shifting thing. this is sort of like cash for clunkers.
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essentially defers to t payment in the broader scheme of things, this will do nothing to help states on the verge of insolvency. the bigger problems are unfunded pensions and broader budget shortfalls. unfunded pensions across the country now are estimated at $3.5 trillion by the state. and the budget shortfalls are $250 billion. what you are talking apt here is relatively peanuts. >> yeah, the but the states are grappling with the unfunded pension liabilities. >> some of them. some of the states are grappling. >> some of them. some of them have democratic governors and some have republican governors dealing with the same problem this is a tax moratorium until hopefully a time in the future when they are more on their feet and can handle this. i think this is a pretty reasonable way of helping the states. there is not going to be a bail-out for bankrupt states. i have can't imagine any republicans in congress voting for that. however, i can imagine a lot of republican governors, telling their republican
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senators in congress people that this sounds good to them. >> bret: charles? >> i think that is right, but that's because it's trivial amount of money. $1.3 trillion is the interest on the loan that the feds have given the state. the feds are foregoing. when you think about the federal budget next year, $1.3 billion, where the deficit alone will be $1.5 trillion, that's less than a tenth of 1% of the deficit. so, it's not a lot of money. >> bret: at first you said, "$1.3 trillion." you meant $1.3 billion. >> sorry. $1.3 billion that the states would be paying now on the interest of the loans received. >> bret: in the shadow of a $1.5 trillion budget deficit for the year. >> thank you. i was only off by three decimal points. so it's a small amount of money. but i think the reason there might be a fight over this is that you've got to ask yourself at what point does the federal government stop subsidizing the state?
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it poured a huge amount of money in stimulus one in to the states, tens of billions. as a way to help it out of a recession. we are now 18 months beyond the recession. we know what is coming is what steve is talking about, the huge overhang of the pension liabilities. which the states are in no shape to take care of. and the benefits packages of government employees, which are way out of control. the only answer here is going to be bankruptcy of which we do not yet have a mechanism. states have no way to do it. we have to do -- we have to do to michigan and other states what has been done to g.m. bankruptcy to allow it to renegotiate the contract with the workers, and in the end to redo undue, reshape the liabilities which it cannot in any way meet. >> bret: steve, people like governor chris christie of new jersey say it's too far right now. the states have more they can do, that they can cut. you don't have to get to illinois where you are raising
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taxes by 67%. but some of the states are in a dire space. if you provide a mechanism for state bankruptcy. we do this with municipalities. if you provide them the mechanism for bankruptcy if they need to, it gives them way to negotiate there are things that the state constitution could permit, likely decided by the court. it allows the states to sit down across the table from the big public employee unions and say look, we have no choice here. we now have to redo this. you have to be at the table and be willing to make concessions. >> bret: mara, there is no atmosphere as you talk about for any bail-out in washington. you think that this delaying mechanism actually is going to fly? >> well, it might. it will depend on what republicans hear from their states. from states who feel like this kind of relief, it's small,
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gives them a little breathing room to do the really big problem solving like steven is talking about to renegotiate the public pension with the public employee union. that is happening and jerry brown and an drew cuomo has to do it as much as scott walker. the republican governor. so, yeah, i think this is something that will be seen as reasonable stock up. >> bret: charles, we are getting ready for a big budget bat that starts with the budget comes out next week. leading up to the debt ceiling, increase vote that will likely come sometime soon. >> bret: the aid to the states is not going to be the main issue in this budget. it's going to be how trivial of a cut that the obama administration is ordering in the budget today, freeze which was, is a rounding error in what our deficit is, the $1.5 trillion deficit. the fact that there was nothing serious in the state of the union offer, as a way to actually attack the mountain of debt.
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remember, this administration has added, three years in a row of almost 1.5 trillion a year of debt. unprecedented in our history and completely unsustainable. >> bret: for more on this subject, go to the show notes section of the home page at foxnews.com/specialreport. next up, the demise of the democratic leadership council. vu=8o3ñfçpñolmxgkobç÷kvóv where to go for a quiet get away. [ male announcer ] thanks to the orbitz matrix display, you can make more knowledgeable decisions when booking vacation packages. ♪ see all your hotel and flight options
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and savings for the ideal vacation. perfect. [ male announcer ] when you orbitz, you know.
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i don't feel like we're on the same page with the direction of the policy and country moving forward. >> what did she say to you? >> there is difference in opinion of why we had the outcome in the election we did it's my view we were not speaking to the american people. we were going further levitt than we should have. the people who gave the democrats a chance in 2006 and
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2008 decided to go a different direction. some in the democratic caucus believe, honestly believe, though i disagree, we didn't go far enough to the left. >> bret: moderate house democrats complaining openly they don't get any respect from the leadership in the house in the name of minority leader nancy pelosi. this is as the democratic leadership council, once chaired by bill clinton who went on to take the presidency, it was believed to be a place, laboratory for the moderate policy ideas that got clinton on the road to the presidency. it's now no longer, soon to be no longer what about this? what does it say about the nation political discourse? we're back with the panel. mara? >> sometimes it's hard to keep a think tanks or policy shop going. the d.l.c. won the fight it set out to win, to move the democratic party to the center and it elected bill clinton. and when you look at the
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number of d.l.c. veterans, clinton veterans who are now in the white house recently hired by president obama, bruce reid who ran the d.l.c. and now the vice president gene of staff. he has gene sperling and jack lu and bill daley. i think the d.l.c. demise shouldn't be interpreted as ah, the centrist wing of the party crumbled away. what jason altmire was talking about is the house democrats. he has a complaint about nancy pelosi and the leadership of the house democrats which is to the left. i think the obama administration and president himself moved to center. >> it's gobbing of the center and it moves to the center because it has to. it will not get through a republican house anyway. if obama wants re-election, he
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doesn't want a second show acting as in november. he has to act in november and having centrists will help him. the fact is that this administration, the house, and the senate as well, governed from the left and achieved a lot, healthcare reform and they have been in party since the vietnam
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to the left to be acceptable to his own base. remember, i mean, this is of course after the democratic primaries. he moved to the left. he cast aside his own division. and i think you have been seeing. this. >> then he got a challenge when he ran for senate from the left. >> exactly.
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you have been seeing this pretty steadily since the 2011. to the point now where the states supplied most of the moderate democrats, most of the blue dogs are now red states like georgia, like texas, like alabama. like mississippi. >> bret: so you are saying, mara, that it goes to the administration moving to the center. on capitol hill, are moderates becoming extent? >> well, they are certainly becoming fewer. wait a minute, if you are going to say that the democratic party has been getting more homogeniusly less over time, sure. the republican party has been getting more homogeniusly right at the same time. they are the parties that sorted themselves. i don't think there is any overlap. the most liberal democrat is more conservative than the conservative democrat. i don't think that the the demise is the symbol that centrism is extent in the democratic party. not after after what president obama has done the past couple
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of months. >> bret: last word. >> that's if you belief it's you a then particular semitism. i think it's -- i can assure you obama is reelected with majorities in the house and the senate, we will see a return to the hyperliberallism of the first years. i'm not sure it's still -- it can be done because the electorate had rendered the verdict on this. >> charles, he is going to have a republican senate if he gets reelected. >> bret: we'll see. that's it for the panel but stay tuned for yet one more reason to always know where the camera is
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>> bret: finally tonight, it's always good to remind reporters to be aware of where a camera is positioned and when it might be live. in a white house briefing room you would think everyone knows there are cameras there and they are there all the time. but, apparently, not everyone. >> on monday, here is -- there is monday. show wednesday. show wednesday. loere he is again.
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